Just as the stock market awaits Facebook to go public, GM spokesman Greg Martin confirmed that The General has decided to stop advertising on the addicting social media site.
GM spends about $40 million a year on Facebook marketing, $10 million of which is for paid ad placement. One report claims that the inefficiency of Facebook ads are as high as 83 percent, where respondents have never clicked on a Facebook ad. That number is most likely higher with the youngest age demographics. Last year, clicking on an ad cost GM $4.34 per user in advertising. That’s a hefty spike from the $3.07 rate in 2009
However, this by no way means that the company will be removing its brand and vehicle fan pages. Which is good, because without those pages, Facebook Fridays would never exist.
Comments
If $10 million of its $40 million Facebook marketing budget is for direct ads, then GM is spending $30 million on consultants and PR people to update and curate its Facebook pages. That’s a lot of money that could hire a small army of Gen Y college graduates with a marketing degree (with no other job prospects). I wonder how much of that $30 million is in-house or simply subcontracted to some lucky consulting firm.
Todd said it. The beauty of social media in general is that it’s cheap to do (on the free coins cations side). $30 million a year to 3rd party companies is ridiculous! Give me a million a year, I’ll do it all and do it better myself!
That was supposed to say “free communications”.
That kind of spending is what got GM into bankruptcy in the first place (spending money like the Government) have they not learned anything??